Sale of new cars affected due to rise in duty structure
Wednesday, 12 December 2007
FE Report
The sale of new cars with engine power of 1501 cc and above has remained depressed due to upward adjustment of supplementary duty (SD) in the current fiscal budget, car traders said.
In the current fiscal, the government imposed 20 per cent SD on imported 1500 cc car and 60 per cent for 1501 cc to 2799 cc cars, which fall under luxury category.
But, car importers said cars above 1800 cc are normally considered luxurious ones as per international standard.
"The government has imposed higher duty slab on 1600 cc cars," said H Rashid Nizam, managing director of DH motors limited.
He said the National Board of Revenue (NBR) has already been requested to put the 1600 cc vehicles in the first slab.
Previously, vehicles with engine power up to 1649 cc were placed in the first SD slab as 1500 cc and 1600 cc vehicles differ little in engine capacity, fuel consumption and price, he said.
The country imports around 1400 new cars a year.
Car importers claimed that the duty structure has affected the new car business seriously.
The car importers demanded that the duty should be revised and fixed at previous level.
When contacted, an NBR official said: "We will consider the matter in the next fiscal budget after scrutinising the overall car trade."
In the current fiscal budget, the government reduced supplementary duty from 25 per cent and 65 per cent to 20 per cent and 60 per cent respectively.
He said the government has lowered the import duty of new car aiming to facilitate the middle-income group to buy a new car.
Cars up to 1600 cc could be put in the first duty slab if the budgetary decision had affected new car business, he said.
The sale of new cars with engine power of 1501 cc and above has remained depressed due to upward adjustment of supplementary duty (SD) in the current fiscal budget, car traders said.
In the current fiscal, the government imposed 20 per cent SD on imported 1500 cc car and 60 per cent for 1501 cc to 2799 cc cars, which fall under luxury category.
But, car importers said cars above 1800 cc are normally considered luxurious ones as per international standard.
"The government has imposed higher duty slab on 1600 cc cars," said H Rashid Nizam, managing director of DH motors limited.
He said the National Board of Revenue (NBR) has already been requested to put the 1600 cc vehicles in the first slab.
Previously, vehicles with engine power up to 1649 cc were placed in the first SD slab as 1500 cc and 1600 cc vehicles differ little in engine capacity, fuel consumption and price, he said.
The country imports around 1400 new cars a year.
Car importers claimed that the duty structure has affected the new car business seriously.
The car importers demanded that the duty should be revised and fixed at previous level.
When contacted, an NBR official said: "We will consider the matter in the next fiscal budget after scrutinising the overall car trade."
In the current fiscal budget, the government reduced supplementary duty from 25 per cent and 65 per cent to 20 per cent and 60 per cent respectively.
He said the government has lowered the import duty of new car aiming to facilitate the middle-income group to buy a new car.
Cars up to 1600 cc could be put in the first duty slab if the budgetary decision had affected new car business, he said.